North and South Korean negotiators resumed their meetings in Pyongyang Friday, despite a tense opening session the previous day.
The North's chief delegate walked out of the meeting Thursday, angry over South Korea's attempt to link economic aid for the North to progress on Pyongyang's nuclear disarmament.
North Korea is demanding donations of rice and fertilizer from South Korea. The South is trying to press the North to honor its pledge first to shut down its Yongbyon nuclear reactor.
The pledge came in February at six-nation talks on the North's nuclear weapons programs.
But Pyongyang then missed last Saturday's deadline for the shutdown, and there is still no indication that the shutdown has begun. Paik Hak-soon, a research fellow at the private Sejong Institute in South Korea, says there may be no progress on inter-Korean cooperation if Seoul continues to link the two issues.
"Inter-Korean relations should be separated a little bit from the nuclear issue, otherwise there would be no more progress in inter-Korean relations until the complete denuclearization of Korea is achieved. If we don't provide rice aid, I think North Korea will be less forthcoming in improving inter-Korean relations."
Seoul halted food and fertilizer aid to the North after Pyongyang tested a barrage of missiles in July, and conducted its first nuclear test in October.
It resumed fertilizer shipments only last month, after the North agreed to shut down the Yongbyon reactor - a first step towards total nuclear disarmament.
But the disarmament process has been held up by a delay in releasing millions of dollars in North Korean funds that were frozen in accounts in a Macau bank.
Macau authorities froze the accounts in September 2005 after the U.S. blacklisted the bank, calling it a "willing pawn" in the North's money-laundering and dollar counterfeiting activities.
Macau has now cleared the release of the funds, with U.S. approval. But the transfer has not yet been completed, and Pyongyang insists on having the money in hand before it shuts down the reactor.
On Friday, the official North Korean news agency again reported that Pyongyang is ready to invite United Nations nuclear inspectors into the country to monitor the shutdown as soon as the transfer of funds has been made.